Inside the Trade Deficit

America's trade deficit widened in March, according to figures released yesterday: Imports increased by $188 billion, while exports increased by $147.9 billion. That's the headline news, but there are a couple of important factors lurking underneath those numbers.

1) Exports actually increased at a faster pace than imports did. Exports rose by 3.2 percent and imports rose by 3.1 percent, but since we already imported more than we exported, the raw import figure was a little bigger, and the trade deficit still widened a little.

2) The margin for imports is explained entirely by the rise in the price of oil. March brought us the highest crude oil prices we'd seen in almost two years, as well as a surge in demand. And of course, most of the oil we consume is foreign. If you take oil out of the equation, the trade deficit actually dropped between February and March.